EMAGIN CORPORATION
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (this "Agreement") is entered into
as of February 27, 2002 (the "Closing Date"), by and among eMagin Corporation, a
Delaware corporation (the "Company"), and each of the investors listed on
Schedule A attached hereto (each an "Investor" or collectively, the
"Investors").
The parties hereby agree as follows:
1. Purchase and Sale of Common Shares; Issuance of Warrants.
(a) Subject to the terms and conditions set forth in this Agreement,
the Company has duly authorized for sale, issue and delivery to the Investors
and the Investors shall, severally and not jointly, purchase from the Company
(i) shares of Common Stock, par value $.001 per share (the "Common Stock"), in
the amounts specified opposite each Investor's name under the heading "Amount of
Purchased Shares" on Schedule A attached hereto (the "Purchased Shares") at a
purchase price equal to $0.6913 per Purchased Share, which purchase price per
Purchased Share equals 110% of the daily volume weighted average closing price
per share of the Common Stock on the American Stock Exchange for the five (5)
trading days immediately preceding the Closing Date as reported by Bloomberg
Professional reporting services, and (ii) three year warrants (the "Warrants"
and together with the Purchased Shares and any shares of Common Stock issued
pursuant to the Warrants (such shares, the "Warrant Shares"), the "Securities")
to purchase, as to each Investor, up to a number of shares of Common Stock equal
to 40% of the number of Purchased Shares purchased by such Investor, such
Warrants to have an exercise price per share equal to $0.7542, which exercise
price per share equals 120% of the daily volume weighted average closing price
per share of the Common Stock on the American Stock Exchange for the five (5)
trading days immediately preceding the Closing Date as reported by Bloomberg
Professional reporting services, each such Warrant to be substantially in the
form of Exhibit A attached hereto.
(b) The purchase and sale of the Purchased Shares and Warrants shall
take place concurrently with the execution of this Agreement (the "Closing"). At
the Closing, the Company shall deliver to each Investor (i) an executed
counterpart to this Agreement, (ii) the executed counterpart to the registration
rights agreement (the "Registration Rights Agreement") in the form of Exhibit B
attached hereto, (iii) the executed counterpart to the instructions to transfer
agent (the "Transfer Agent Instructions") in the form of Exhibit C attached
hereto, (iv) share certificates for the amount of their respective Purchased
Shares, and (v) their respective Warrant; in all cases against delivery to the
Company by each Investor of (x) an executed counterpart to this Agreement, (y)
an executed counterpart to the Registration Rights Agreement, and (z) such
Investor's respective purchase price of the Securities in the amount specified
opposite such Investor's name under the heading "Purchase Price" on Schedule A
attached hereto, such payment to be made by bank wire transfer of immediately
available funds to an account designated by the Company.
(c) The parties hereto acknowledge and agree that the sums payable
pursuant to the Registration Rights Agreement shall constitute liquidated
damages and not penalties. The parties further acknowledge that (a) the amount
of loss or damages likely to be incurred is incapable or is difficult to
precisely estimate, (b) the amounts specified in such sections bear a reasonable
proportion and are not plainly or grossly disproportionate to the probable loss
likely to be incurred by the Investors in connection with the failure by the
Company to timely cause the registration of the Registrable Securities (as
defined in the Registration Rights Agreement) and (c) the parties are
sophisticated business parties and have been represented by sophisticated and
able legal and financial counsel and negotiated this Agreement at arm's length.
2. Representations and Warranties of the Investors. As of the date
hereof, each Investor severally as to itself and not jointly hereby represents
and warrants to the Company as follows:
(a) Such Investor is acquiring its respective Securities for the
Investor's own account, not as nominee or agent, for investment and not with a
view to, or for resale in connection with, any distribution or public offering
thereof within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"), provided, however, that by making the representations herein,
the Investors do not agree to hold such Securities for a minimum or other
specific term and reserve the right to dispose of the Securities at any time in
accordance with federal and state securities laws applicable to such
disposition. By executing this Agreement, such Investor further represents that
the Investor does not have any contract, undertaking, agreement or arrangement
with any person to sell, transfer or grant participation to any such person or
to any third person, with respect to the Securities.
(b) Such Investor understands that (i) the Securities have not been
registered under either the Securities Act or the securities laws of any state
of the United States by reason of specific exemptions therefrom, (ii) the
Securities must be held by the Investor indefinitely, and, therefore, such
Investor must bear the economic risk of such investment indefinitely, unless a
subsequent disposition thereof is registered under the Securities Act and the
securities laws of any applicable state or is exempt from such registrations;
(iii) each certificate that represents the Securities will be endorsed with
legends as required by applicable securities laws; and (iv) the Company will
instruct any transfer agent not to register the transfer of any of the
Securities unless the conditions specified in the foregoing legend are
satisfied. For greater certainty, the restrictive legend referred to in clause
(iii) shall be substantially in the following form:
THIS SECURITY (A) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE, AND IS BEING OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS, AND (B)
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE BORROWER
THAT SUCH REGISTRATION IS NOT REQUIRED.
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(c) Such Investor has been furnished with such materials and has been
given access to such information relating to the Company as the Investor has
requested. Such Investor has been afforded the opportunity to ask questions
regarding the Company and the Securities as the Investor has found necessary to
make an informed investment decision. Such Investor has been solely responsible
for its own due diligence investigation of the Company and its business, for its
own analysis of the merits and risks of its investment made pursuant to this
Agreement and for its own analysis of the terms of its investment.
(d) Such Investor is an "accredited investor" within the meaning of
Rule 501 under the Securities Act. Such Investor is in a financial position to
hold the Securities and is able to bear the economic risk and withstand a
complete loss of the Investor's investment in the Securities. Such Investor
recognizes that the Securities involve a high degree of risk. Such Investor is a
sophisticated investor, is able to fend for itself in the transaction
contemplated by this Agreement, and has such knowledge and experience in
financial and business matters that the Investor is capable of evaluating the
merits and risks of the prospective investment in the Securities.
(e) (i) Such Investor has the requisite power and authority to enter
into and perform its obligations under this Agreement, (ii) the execution and
delivery of this Agreement by such Investor and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
action and no further consent or authorization of the Investor (or, to the
extent applicable, its Board of Directors or stockholders) is required, and
(iii) this Agreement has been duly executed and delivered by such Investor and
constitutes a valid and binding obligation of the Investor, enforceable against
the Investor in accordance with its terms, except, in each case, as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or
similar laws relating to, or affecting generally the enforcement of, creditors'
rights and remedies or by other equitable principles of general application.
(f) During the period such Investor holds any Securities, neither such
Investor nor any person acting on its behalf has the intention of entering, or
will enter into, any put option, short position or other similar instrument or
position with respect to the Purchased Shares or any Common Stock that may be
acquired upon exercise of the Warrants; provided, that, nothing in this Section
2(f) shall restrict such Investor from exercising Warrants held by such Investor
and simultaneously selling the shares of Common Stock receivable pursuant to
such exercise.
(g) Such Investor understands, acknowledges and agrees that:
(i) the Securities are highly speculative investments which involve a
substantial degree of risk of loss by such Investor of the Investor's
entire investment in the Company and that the Investor understands and
takes full cognizance of the risk factors related to the purchase of the
Securities;
(ii) The Company has been operating at a loss and may do so for the
foreseeable future; and
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(iii) Any projections or predictions that may have been made available
to such Investor are based on estimates, assumptions and forecasts which
may prove to be incorrect; and no assurance is given that actual results
will correspond with the results contemplated by the various projections.
3. Representations and Warranties of the Company. Except as set forth
in the SEC Documents (as defined in Section 3(f) below) and the separate
disclosure letter (the "Disclosure Letter") prepared by the Company and
delivered concurrently herewith, as of the date hereof the Company represents
and warrants to each of the Investors as follows:
(a) Organization, Good Standing and Power. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate authority to own,
lease and operate its properties and assets and to carry on its business as now
being conducted. The Company is duly qualified to do business and is in good
standing as a foreign corporation in every jurisdiction in which the nature of
the business conducted or property owned by it makes such qualification
necessary, other than those in which the failure so to qualify would not have a
Material Adverse Effect. As used in this Agreement, a "Material Adverse Effect"
shall mean any adverse effect on the business, operations, properties, or
financial condition of the Company that is material and adverse to the Company
and its subsidiaries, taken as a whole, and/or any condition, circumstance, or
situation that would prohibit or otherwise materially interfere with the ability
of the Company to perform any of its material obligations under this Agreement.
(b) Authorization, Enforcement. (i) The Company has the requisite
corporate power and corporate authority to enter into and perform its
obligations under this Agreement and the Securities, pursuant to their
respective terms, (ii) the execution and delivery of this Agreement and the
Securities by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action and no further consent or authorization of the Company or its
Board of Directors or stockholders is required, and (iii) each of this
Agreement, the Purchased Shares, and the Warrants when executed and delivered by
the Company will constitute a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except, in each
case, as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation, conservatorship,
receivership or similar laws relating to, or affecting generally the enforcement
of, creditors' rights and remedies or by other equitable principles of general
application.
(c) Capitalization. The authorized capital stock of the Company
consists of 100,000,000 shares of Common Stock, of which 25,085,145 shares are
issued and outstanding and 10,000,000 shares of preferred stock, par value $.001
per share, of which no shares are issued and outstanding. All of the outstanding
shares of the Company's Common Stock have been duly authorized and validly
issued and are fully paid and non-assessable and were issued in accordance with
the registration or qualification provisions of the Securities Act and any
relevant state securities laws or pursuant to valid exemptions therefrom. Except
as set forth in this Agreement, no shares of Common Stock are entitled to
preemptive rights or registration rights and there are no outstanding options,
warrant, scrip, rights to subscribe to, calls or commitments
of any character whatsoever relating to, or securities or rights convertible
into, any shares of capital stock of the Company. Furthermore, except as set
forth in this Agreement, there are no contracts, commitments, understandings, or
arrangements by which the Company is or may become bound to issue additional
shares of the capital stock of the Company or options, securities or rights
convertible into shares of capital stock of the Company. The Company is not a
party to, and it has no knowledge of, any agreement restricting the voting or
transfer of any shares of the capital stock of the Company. The offer and sale
of all capital stock, convertible securities, rights, warrants, or options of
the Company issued prior to the Closing complied materially with all applicable
federal and state securities laws, and no stockholder has a right of rescission
or damages with respect thereto which would have a Material Adverse Effect. The
Company has filed as exhibits to the SEC Documents true and correct copies of
the Company's articles or certificate of incorporation as in effect on the date
hereof (the "Charter"), and the Company's bylaws as in effect on the date hereof
(the "Bylaws"). The Company has not received any notice from the AMEX
questioning or threatening the continued inclusion of the Common Stock on such
market.
(d) Issuance of Securities. The Purchased Shares, the Warrants and the
Warrant Shares to be issued under this Agreement have been duly authorized by
all necessary corporate action and, when paid for and issued in accordance with
the terms thereof, the Purchased Shares, the Warrants, and the Warrant Shares
shall be validly issued and outstanding, fully paid and non-assessable.
(e) No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated herein do not and will not (i) violate any provision of the
Company's Charter or Bylaws, (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, mortgage, deed of trust, indenture, note, bond,
license, lease agreement, instrument or obligation to which the Company is a
party, (iii) create or impose a lien, charge or encumbrance on any property of
the Company under any agreement or any commitment to which the Company is a
party or by which the Company is bound or by which any of its respective
properties or assets are bound, or (iv) result in a violation of any federal,
state, or local statute, rule, regulation, order, judgment or decree (including
any federal or state securities laws and regulations) applicable to the Company
or any of its subsidiaries or by which any property or asset of the Company or
any of its subsidiaries are bound or affected. To the knowledge of the Company,
the business of the Company and its subsidiaries is not being conducted in
violation of any laws, ordinances or regulations of any governmental entity,
except for possible violations which singularly or in the aggregate do not and
will not have a Material Adverse Effect. The Company is not required under any
federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform any of its
obligations under this Agreement, or issue and sell the Securities in accordance
with the terms hereof (other than any filings which may be required to be made
by the Company with the SEC or state securities administrators subsequent to the
Closing and any registration statement which may be filed pursuant hereto);
provided that, for purpose of the representation made in this
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sentence, the Company is assuming and relying upon the accuracy of the relevant
representations and agreements of each Investor herein.
(f) SEC Documents, Financial Statements. The Common Stock is
registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the Company has timely filed all reports,
schedules, forms, statements and other documents required to be filed by it with
the U.S. Securities and Exchange Commission (the "SEC") pursuant to the
reporting requirements of the Exchange Act, including material filed pursuant to
Section 13(a) or 15(d) of the Exchange Act (all of the foregoing including
filings incorporated by reference therein being referred to herein as the "SEC
Documents"). The Company has directed the Investor to accurate and readily
accessible sources of true and correct copies of the SEC Documents. As of their
respective filing dates, the SEC Documents complied in all material respects
with the requirements of the Exchange Act or the Securities Act, as applicable,
and the rules and regulations of the SEC promulgated thereunder applicable to
such documents, and, as of their respective filing dates, none of the SEC
Documents contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The financial statements of the Company included in the SEC
Documents comply as to form in all material respects with applicable accounting
requirements under the United States Generally Accepted Accounting Principles,
as those conventions, rules and procedures are determined by the Financial
Accounting Standards Board ("GAAP"), and the published rules and regulations of
the SEC or other applicable rules and regulations with respect thereto. Such
financial statements have been prepared in accordance with GAAP applied on a
consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the footnotes thereto or (ii) in the
case of unaudited interim statements, to the extent they may be condensed or
summary statements), and fairly present in all material respects the financial
position of the Company and its subsidiaries as of the dates thereof and the
results of operations and cash flows for the periods then ended (subject, in the
case of unaudited statements, to normal year-end audit adjustments).
(g) Disclosure. The Company has provided each Investor with all the
information reasonably available to it without undue expense that such Investor
has requested for deciding whether to purchase the Purchased Shares and
Warrants. None of this Agreement, other agreements, written statements or
certificates made or delivered in connection herewith and the SEC Documents,
when taken in the aggregate, as of the date of the Closing contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements herein or therein not misleading.
(h) Exemption from Registration; Valid Issuances. Subject to the
accuracy of the Investors' representations contained in Section 2, the sale of
the Purchased Shares, the Warrants and the Warrant Shares will not require
registration under the Securities Act and/or any applicable state securities
law. Neither the sales of the Purchased Shares, the Warrants or the Warrant
Shares pursuant to, nor the Company's performance of its obligations under, this
Agreement, the Registration Rights Agreement, or the Warrants will (i) result in
the creation or imposition by the Company of any liens, charges, claims or other
encumbrances upon the Purchased Shares, the Warrants or the Warrant Shares or,
except as contemplated herein, any of
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the assets of the Company, or (ii) entitle the holders of any shares of capital
stock of the Company to preemptive or other rights to subscribe for or acquire
any securities of the Company. The Purchased Shares, the Warrants and the
Warrant Shares shall not subject the Investors to personal liability to the
Company or its creditors by reason of the possession thereof.
(i) Litigation and Other Proceedings. There are no lawsuits or
proceedings pending or, to the knowledge of the Company, threatened, against the
Company or any subsidiary, nor has the Company received any written or oral
notice of any such action, suit, proceeding or investigation, which could
reasonably be expected to have a Material Adverse Effect. No judgment, order,
writ, injunction or decree or award has been issued by or, to the knowledge of
the Company, requested of any court, arbitrator or governmental agency which
could result in a Material Adverse Effect.
(j) No Misleading or Untrue Communication. The Company and, to the
knowledge of the Company, any person representing the Company, or any other
person selling or offering to sell the Purchased Shares or the Warrants in
connection with the transactions contemplated by this Agreement, have not made,
at any time, any oral communication in connection with the offer or sale of the
same which contained any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements, in the light of the
circumstances under which they were made, not misleading.
(k) Material Non-Public Information. The Company has not disclosed to
the Investors any material non-public information that (i) if disclosed, would
reasonably be expected to have a material effect on the price of the Common
Stock or (ii) according to applicable law, rule or regulation, should have been
disclosed publicly by the Company prior to the date hereof but which has not
been so disclosed.
(l) No General Solicitation or Advertising in Regard to this
Transaction. Neither the Company nor any of its affiliates nor, to the knowledge
of the Company, any person acting on its or their behalf (i) has conducted or
will conduct any general solicitation (as that term is used in Rule 502(c) of
Regulation D) or general advertising with respect to the sale of the Purchased
Shares or the Warrants, or (ii) made any offers or sales of any security or
solicited any offers to buy any security under any circumstances that would
require registration of the Purchased Shares, the Warrants or the Warrant Shares
under the Securities Act.
(m) Common Stock. The Company has registered its Common Stock pursuant
to Section 12(b) or (g) of the Exchange Act and is in full compliance with all
reporting requirements of the Exchange Act, and the Company is in compliance
with all requirements for the continued listing or quotation of its Common Stock
and such Common Stock is currently listed or quoted on the American Stock
Exchange (the "Amex"). The Company has not received any notice regarding, and to
its knowledge there is no threat, of the termination or discontinuance of the
eligibility of the Common Stock for such listing.
4. Covenants of each Investor. Each Investor, severally and not
jointly, covenants with the Company that it will, whenever required by federal
securities laws, deliver the prospectus included in the Registration Statement
to any purchaser of Purchased Shares from the Investor.
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5. Covenants of the Company.
(a) Reservation of Common Stock. As of the date hereof, the Company
has reserved and the Company shall continue to reserve and keep available at all
times, free of preemptive rights, shares of Common Stock for the purpose of
enabling the Company to issue the Warrant Shares pursuant to this Agreement.
(b) Listing of Common Stock. Until the Investors have disposed of all
of their Registrable Securities, the Company hereby agrees to use its
commercially reasonable efforts to maintain the listing of the Common Stock on
the Amex or on such other principal market as the Company becomes listed and
trades after the date hereof including the Nasdaq National Market, the Nasdaq
Small-Cap Market, the New York Stock Exchange or the OTC Bulletin Board (the
"Principal Market"), to comply in all material respects with the Company's
reporting, filing and other obligations under the bylaws or rules of the
Principal Market and as soon as reasonably practicable following the Closing to
use its commercially reasonable efforts to list the Purchased Shares and the
Warrant Shares on the Principal Market. The Company further agrees that if the
Company applies to have the Common Stock traded on any Principal Market other
than the Amex, it will include in such application the Purchased Shares and the
Warrant Shares, and will take such other reasonable action as is necessary or
desirable in the opinion of the Investors to cause the Purchased Shares and the
Warrant Shares to be listed on such other Principal Market as promptly as
possible.
(c) Exchange Act Registration. The Company will use its commercially
reasonable efforts to cause its Common Stock to continue to be registered under
Section 12(b) or (g) of the Exchange Act, to comply in all respects with its
reporting and filing obligations under the Exchange Act, and will not take any
action or file any document (whether or not permitted by the Exchange Act or the
rules thereunder) to terminate or suspend such registration or to terminate or
suspend its reporting and filing obligations under said Exchange Act until the
Investors have disposed of all of their Registrable Securities.
(d) Legends. The certificates evidencing the Registrable Securities
shall be free of restrictive legends, except as set forth in Section 2. If the
transfer agent of the Common Stock (the "Transfer Agent") or an Investor's
broker-dealer requires a legal opinion from the Company's legal counsel pursuant
to the Transfer Agent Instructions to issue new certificates free of a legend to
an Investor and Company's counsel fails to deliver such opinion (provided that
any inability to deliver such opinion due to a legal impediment communicated by
the Company's counsel to the relevant Investor shall not be deemed to be a
failure to deliver such opinion hereunder) to the Transfer Agent within five (5)
trading days of receipt by such Company's counsel of such request in writing
from the Transfer Agent or the Investor's broker-dealer, then the Investor may
independently retain legal counsel to provide such opinion in a form
satisfactory to the Company and the Company shall pay the reasonable costs and
expenses required for such legal opinion.
6. Miscellaneous.
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(a) Survival. The representations, warranties and covenants made by
each of the Company and each Investor in this Agreement, the annexes, schedules
and exhibits hereto and in each instrument, agreement and certificate entered
into and delivered by them pursuant to this Agreement, shall survive the Closing
and the consummation of the transactions contemplated hereby.
(b) Indemnity. (i) Each of the Investors, severally and not jointly,
shall indemnify, defend and hold harmless the Company, and any officers,
employees, shareholders, partners, agents, directors or controlling persons of
the Company (collectively the "Company Indemnified Parties" and individually a
"Company Indemnified Party") who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, against losses,
liabilities and expenses of each Company Indemnified Party (including attorneys'
fees, judgments, fines and amounts paid in settlement, payable as incurred)
incurred by such person or entity in connection with such action, arbitration,
suit or proceeding, by reason of or arising from (x) any misrepresentation or
misstatement of facts or omission to represent or state facts made by such
Investor to the Company, including, without limitation, the representation and
warranties provided by such Investor to the Company in this Agreement, or (y)
litigation or other proceeding brought in respect of the transactions
contemplated hereby by such Investor against one or more Company Indemnified
Parties wherein the Company Indemnified Parties are the prevailing party.
(ii) The Company shall indemnify, defend and hold harmless each
Investor, and any officers, employees, shareholders, partners, agents, directors
or controlling persons of such Investor (collectively, the "Investor Indemnified
Parties" and individually an "Investor Indemnified Party") who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, against losses, liabilities and expenses of an Investor
Indemnified Party (including attorneys' fees, judgments, fines and amounts paid
in settlement, payable as incurred) incurred by such person or entity in
connection with such action, arbitration, suit or proceeding, by reason of or
arising from (i) any misrepresentation or misstatement of facts or omission to
represent or state facts made by the Company to such Investor, including,
without limitation, the representations and warranties provided by the Company
to such Investor in this Agreement, or (ii) litigation or other proceeding
brought in respect of the transactions contemplated hereby by the Company
against one or more Investor Indemnified Parties wherein the Investor
Indemnified Parties are the prevailing party.
(c) Fees and Expenses. Each party shall pay all of its own fees and
expenses related to the transactions contemplated by this Agreement.
(d) Entire Agreement; Amendment. This Agreement and the other
schedules and exhibits attached hereto, all of which form a part of this
Agreement, contain the entire understanding of the parties with respect to the
matters covered hereby and, except as specifically set forth herein, neither the
Company nor any Investor make any other representations, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may be
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waived or amended other than by a written instrument signed by the party against
whom enforcement of any such amendment or waiver is sought.
(e) Notices. Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (i) upon hand delivery, overnight mail or courier service
at the address or number designated on the signature pages hereof (if delivered
on a business day during normal business hours where such notice is to be
received), or the first business day following such delivery (if delivered other
than on a business day during normal business hours where such notice is to be
received) or (ii) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be as set forth on the signature pages hereof. Any
party hereto may from time to time change its address for notices by giving
written notice of such changed address to the other parties hereto in accordance
herewith.
(f) Waivers. No waiver by any party of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any other provisions, condition
or requirement hereof, nor shall any delay or omission of any party to exercise
any right hereunder in any manner impair the exercise of any such right accruing
to it thereafter.
(g) Headings. The article, section and subsection headings in this
Agreement are for convenience only and shall not constitute a part of this
Agreement for any other purpose and shall not be deemed to limit or affect any
of the provisions hereof.
(h) No Third Party Beneficiaries; Assignment. Except for the Company
Indemnified Parties and Investor Indemnified Parties, this Agreement is intended
for the benefit of the parties hereto and their respective successors and
permitted assigns and is not for the benefit of, nor may any provision hereof be
enforced by, any other person. Each Investor and the Company may not assign any
of its respective rights or obligations under this Agreement without the written
consent of each other party hereto.
(i) Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York, without giving
effect to the choice of law provisions. The Company and each Investor waives any
right to a jury trial with respect to any dispute arising out of this Agreement.
(j) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and shall become effective when counterparts have been signed by each
party and delivered to the other parties hereto, it being understood that all
parties need not sign the same counterpart. Execution of counterparts may be by
facsimile.
(k) Publicity. The Company and the Investors may agree upon a press
release to be issued by the Company upon execution of this Agreement describing
this Agreement and the transactions contemplated hereby. Thereafter, any party
may make a public statement or
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announcement with respect to this Agreement or the transactions contemplated
hereby or the existence of this Agreement; provided, however, that prior to
issuing any such press release, making any such public statement or
announcement, such party must obtain the prior consent of each other party,
which consent shall not be unreasonably withheld or delayed.
(l) Severability. The provisions of this Agreement are severable and,
in the event that any court shall determine that any one or more of the
provisions or part of the provisions contained in this Agreement shall, for any
reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
or part of a provision of this Agreement and this Agreement shall be reformed
and construed as if such invalid or illegal or unenforceable provision, or part
of such provision, had never been contained herein, so that such provisions
would be valid, legal and enforceable to the maximum extent possible, so long as
such construction does not materially adversely effect the economic rights of
either party hereto.
(m) Further Assurances. From and after the date of this Agreement,
upon the request of the Investors, on the one hand, or the Company, on the other
hand, each of the Company and the Investors shall execute and deliver such
instruments, documents and other writings as may be reasonably necessary or
desirable to confirm and carry out and to effectuate fully the intent and
purposes of this Agreement.
* * * * * *
[Signature Pages Follow]
-11-
This Securities Purchase Agreement has been duly executed as of the
date and year first written above.
EMAGIN CORPORATION
By
-------------------------------
Name:
Title:
-12-
INVESTORS:
Vertical Ventures Investments, LLC
----------------------------------
Name:
Address:
Newington Invest Limited
----------------------------------
Name:
Address:
----------------------------------
Name: Eric Friedland
Address:
Rainbow Gate Corporation
----------------------------------
Name:
Address:
-13-
----------------------------------
Name: David K. Zierk
Address:
----------------------------------
Name: Andrea Della Valle
Address:
Triton West Group, Inc.
----------------------------------
Name:
Address:
----------------------------------
Name: Ben Johnson
Address:
-14-
Schedule A - INVESTORS
Name and Address of Investor Purchase Price Amount of Purchased Shares Warrant Amount
---------------------------- -------------- -------------------------- --------------
Name: Vertical Ventures Investments, LLC $ 499,999.56 723,275 289,310
Notice Address:
Name: Newington Invest Limited $ 500,000.00 723,275 289,310
Notice Address:
Name: Eric Friedland $ 125,000.00 180,819 72,328
Notice Address:
Name: Rainbow Gate Corporation $ 500,000.00 723,275 289,310
Notice Address:
Name: David K. Zierk $ 100,000.00 144,655 57,862
Notice Address:
Name: Andrea Della Valle $ 69,130.00 100,000 40,000
Notice Address:
Name: Triton West Group, Inc. $ 499,000.00 721,829 288,732
Notice Address:
Name: Ben Johnson $ 207,390.00 300,000 120,000
Notice Address:
------------- ------------- -------------
TOTAL $2,500,519.56 3,617,128 1,446,852
Exhibit A - Form of Warrant
[See attached]
Exhibit B - Form of Registration Rights Agreement
[See attached]
Exhibit C - Form of Instruction to Transfer Agent
[See attached]